What Does Net Metering Mean?

If you are thinking about going solar, you may be wondering what is in it for you? Yes, you can get reduced energy bills, but are there any other incentives? For example, what happens if your solar panels generate more electricity than is needed to power your home? What happens to that energy?

What is Net Metering?

Any surplus energy that a solar panel system generates is either sent back to the grid or stored on a solar battery storage system. According to the folk at Vivint Solar, some utility companies offer a program known as net metering for homes that do not have battery storage. This means that any surplus energy that is sent backcan be offset against the homeowner’s utility billby way of a credit.

These companies will track the amount of energy going to and from a home to the grid and will calculate the ‘net power’, which they will then buy from the customer. During the summer months, home solar panel systems will typically generate more power than the homeowner uses, but in the winter monthsthe opposite may be true. Net metering allows the surplus energy generated in the summer to be offset against the customer’s winter usage, thus reducing their bills. In some states, where the sun shines all year round, the solar panels are continuously generating more than the homeowner uses and the utility company will then make a payment for any excess electricity.

What are the Benefits of Net Metering?

The most obvious benefit of net metering is that it allows you to make the most of your solar panel system, even when the sun is not shining. The surplus energy generated by the system can be sent back to the grid and then offset against the homeowner’s utility bill at times when the solar panels are not working at full capacity.

Net metering makes solar power more attractive, meaning that more and more people are choosing to install solar panel systems in their homes. The more people who utilize this clean, renewable energy source, the better for the environment.

What are the Disadvantages of Net Metering?

Although net metering has the benefit of reducing electricity bills, there are some disadvantages, particularly in terms of the fact it is not available everywhere, so not everyone is benefiting. In some states, homeowners do not have access to net metering while in othersonly certain utility companies provide the program.

Furthermore, in some states, policies are changing with regards to net metering because it can often be too favorable for the homeowner. It is likely that homeowners may see a reduced rate for the energy they send back to the grid in the coming years. However, it should be noted that even with a reduction in the rate they receive for their surplus energy, homeowners with solar panels will still benefit from net metering.

It should also be noted that the amount a utility company will pay for energy sent from homes is likely to be lower than the amount homeowners will pay when they import electricity back from the grid. It is therefore better for homeowners to store their excess energy in battery systems from which they can draw power when their solar panels are not generating enough.


Net metering is a program that allows solar panel owners to send back surplus electricity to the grid, for which they will receive a credit that can be used to reduce their utility bills. This allows homeowners to make the most of their solar panels at times when their system is generating more energy than they require to power the home.

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